Bill Sponsors
Ujifusa, DiPalma, Ciccone, Famiglietti, DiMario, Valverde, Gu, McKenney, Murray, and Lauria
Committee
Senate Finance
Summary
Select
The legislation amends the Rhode Island "Property Tax Relief" chapter to expand financial assistance for eligible residents. It raises the maximum household income threshold for calculating the tax credit from $35,000 to $50,000. The bill also increases the maximum credit amount to $850 for tax years beginning on or after January 1, 2027. Furthermore, starting in 2023, the income ranges and maximum credit amounts will be adjusted annually based on the Consumer Price Index (inflation), ensuring the relief keeps pace with the cost of living.
Sponsor
Analysis
Pros for Progressives
- Expands the social safety net by raising the income eligibility threshold to $50,000, allowing more working-class families and individuals to access essential financial relief.
- Implements an automatic annual adjustment based on the Consumer Price Index, ensuring that inflation does not erode the purchasing power of the tax credit for vulnerable residents.
- Increases the maximum credit amount to $850 by 2027, providing direct financial assistance to low-income homeowners and renters struggling with the high cost of housing.
Cons for Progressives
- The increase to an $850 maximum credit is delayed until 2027, leaving struggling families without immediate substantial relief during the current economic climate.
- While the income threshold is raised to $50,000, this cap may still exclude many moderate-income households who are burdened by the high cost of living and housing in Rhode Island.
- The legislation acts as a bandage for housing affordability rather than addressing the systemic root causes of poverty or funding the relief through progressive taxation on the wealthy.
Pros for Conservatives
- Provides direct property tax relief, allowing citizens to keep more of their earned income rather than surrendering it to the government.
- Protects taxpayers against the hidden tax of inflation by indexing the credit limits to the Consumer Price Index, ensuring government benefits reflect economic reality.
- Supports home ownership and stability by helping residents, particularly those on fixed incomes, afford to stay in their properties without creating a new government bureaucracy.
Cons for Conservatives
- Increases state spending and reduces revenue, which places a higher burden on other taxpayers to fund the government's budget.
- Establishes automatic annual increases tied to inflation, effectively putting government spending on autopilot and removing legislative oversight for future budget cycles.
- Expands a wealth redistribution program by raising income thresholds, moving further away from a flat tax system where everyone contributes equally.
Constitutional Concerns
None Likely
Impact Overview
Groups Affected
- Low-income homeowners
- Renters
- Elderly residents
- Taxpayers
- Department of Revenue
Towns Affected
All
Cost to Taxpayers
Amount unknown
Revenue Generated
None
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Bill Status
Current Status
Held
Comm Passed
Floor Passed
Law
History
• 01/09/2026 Introduced, referred to Senate Finance
Bill Text
SECTION 1. Section 44-33-9 of the General Laws in Chapter 44-33 entitled "Property Tax Relief" is hereby amended to read as follows:
44-33-9. Computation of credit.
The amount of any claim made pursuant to this chapter shall be determined as follows:
(1) For any taxable year, a claimant is entitled to a credit against his or her tax liability equal to the amount by which the property taxes accrued or rent constituting property taxes accrued upon the claimant’s homestead for the taxable year exceeds a certain percentage of the claimant’s total household income for that taxable year, which percentage is based upon income level and household size. The credit shall be computed in accordance with the following table:
Income Range 1 Person 2 or More Persons
less than $6000 3% 3%
$6001-9000 4% 4%
$9001-12000 5% 5%
$12001-15000 6% 5%
$15001-35000 50000 6% 6%
(2) The maximum amount of the credit granted under this chapter will be as follows:
Year Credit Maximum
Commencing July 1977 $ 55.00
Commencing July 1978 $150.00
Commencing July 1979 $175.00
Commencing July 1980 $200.00
Commencing on July 1997 and subsequent years $250.00
Commencing on July 2006 $300.00
Commencing July 2007 and subsequent tax years ending on or before December 31, 2021, the credit shall be increased, at a minimum, to the maximum amount to the nearest five dollars ($5.00) increment within the allocation of five one-hundredths of one percent (0.05%) of net terminal income derived from video lottery games up to a maximum of five million dollars ($5,000,000) until a maximum credit of five hundred dollars ($500) is obtained pursuant to the provisions of § 42-61-15. In no event shall the exemption in any fiscal year be less than the prior fiscal year.
For tax years beginning on or after January 1, 2022, the maximum credit shall be six hundred dollars ($600).
For tax years beginning on or after January 1, 2027, the maximum credit shall be eight hundred fifty dollars ($850).
For tax years beginning on or after January 1, 2023 , the income range provided pursuant to subsection (1) of this section and the maximum credit granted pursuant to subsection (2) of this section shall be adjusted by the percentage increase in the Consumer Price Index for all Urban Consumers (CPI-U) as published by the United States Department of Labor Statistics determined as of September 30 of the prior calendar years. Said adjustment shall be compounded annually and shall be rounded up to the nearest five dollar ($5.00) increment. In no event shall the income range or the maximum credit in any tax year be less than the prior tax year.
SECTION 2. This act shall take effect upon passage.
44-33-9. Computation of credit.
The amount of any claim made pursuant to this chapter shall be determined as follows:
(1) For any taxable year, a claimant is entitled to a credit against his or her tax liability equal to the amount by which the property taxes accrued or rent constituting property taxes accrued upon the claimant’s homestead for the taxable year exceeds a certain percentage of the claimant’s total household income for that taxable year, which percentage is based upon income level and household size. The credit shall be computed in accordance with the following table:
Income Range 1 Person 2 or More Persons
less than $6000 3% 3%
$6001-9000 4% 4%
$9001-12000 5% 5%
$12001-15000 6% 5%
$15001-
(2) The maximum amount of the credit granted under this chapter will be as follows:
Year Credit Maximum
Commencing July 1977 $ 55.00
Commencing July 1978 $150.00
Commencing July 1979 $175.00
Commencing July 1980 $200.00
Commencing on July 1997 and subsequent years $250.00
Commencing on July 2006 $300.00
Commencing July 2007 and subsequent tax years ending on or before December 31, 2021, the credit shall be increased, at a minimum, to the maximum amount to the nearest five dollars ($5.00) increment within the allocation of five one-hundredths of one percent (0.05%) of net terminal income derived from video lottery games up to a maximum of five million dollars ($5,000,000) until a maximum credit of five hundred dollars ($500) is obtained pursuant to the provisions of § 42-61-15. In no event shall the exemption in any fiscal year be less than the prior fiscal year.
For tax years beginning on or after January 1, 2022, the maximum credit shall be six hundred dollars ($600).
For tax years beginning on or after January 1, 2027, the maximum credit shall be eight hundred fifty dollars ($850).
For tax years beginning on or after January 1, 2023 , the income range provided pursuant to subsection (1) of this section and the maximum credit granted pursuant to subsection (2) of this section shall be adjusted by the percentage increase in the Consumer Price Index for all Urban Consumers (CPI-U) as published by the United States Department of Labor Statistics determined as of September 30 of the prior calendar years. Said adjustment shall be compounded annually and shall be rounded up to the nearest five dollar ($5.00) increment. In no event shall the income range or the maximum credit in any tax year be less than the prior tax year.
SECTION 2. This act shall take effect upon passage.